Early Look

Thursday, April 22, 2021

Futures	Up/Down	%	Last
Dow	-4.00	0.01%	34,012
S&P 500	-3.25	0.08%	4,161
Nasdaq	-11.50	0.08%	13,907

 

 

Stock futures are edging lower after a massive rebound for stocks on Wednesday, as the main market stories remain corporate earnings (which have thus far been very strong) and fears that the lingering coronavirus pandemic could halt a global economic rebound. The yield on the benchmark 10-year Treasury was unchanged early Thursday to 1.564%, near a five-week low (which has boosted precious metals lately). In Asian markets, The Nikkei Index jumped 679 points to 29,188, the Shanghai Index slipped -7 points to 3,465 and the Hang Seng Index gained 133 points to 28,755. In Europe, the German DAX is up around 70-points to 15,265, while the FTSE 100 is up a few points at 6,900. Stocks surged on Wednesday, closing at the highs for major averages and snapping the modest two-day losing streak as economic reopening stocks led major averages higher. Ten out of the eleven S&P sectors ended higher, led by Energy, Financials, and Industrials while Utilities declined. Streaming stocks such as Viacom and Discovery advanced, which countered Netflix weakness after disappointing subscriber numbers and outlook while DISH jumped after teaming up with Amazon Web Services. Electric vehicle stocks gained as the U.S. and China moved on cutting emissions. A moderately busy day today with weekly jobless claims, existing home sales and manufacturing data.

 

Market Closing Prices Yesterday

·     The S&P 500 Index jumped 38.48 points, or 0.93%, to 4,173.42

·     The Dow Jones Industrial Average rose 316.01 points, or 0.93%, to 34,137.31

·     The Nasdaq Composite jumped 163.95 points, or 1.19%, to 13,950.22

·     The Russell 2000 Index surged 51.42 points, or 2.53% to 2,239.63

 

Events Calendar for Today

·     8:30 AM ET         Weekly Jobless Claims…est. 617K

·     8:30 AM EST      Continuing Claims…est. 3.667M

·     10:00 AM EST    Existing Home Sales MoM for March…est. 6.19M

·     10:00 AM EST    Leading Index for March…est. 1.0%

·     10:30 AM ET      Weekly EIA Natural Gas Inventory Data

·     11:00 AM EST    Kansas City Fed Manufacturing for March…prior 23

 

Earnings Calendar:

·     Earnings Before the Open: AAL, AEP, AFI, ALK, AMAL, ARCH, AUB, BIIB, BKU, BX, CADE, CLF, DGX, DHI, DHR, DOW, EWBC, FCX, GPC, GTLS, HBAN, HCA, HRI, HZO, IIIN, IQV, LUV, LYTS, MKTX, NUE, ODFL, PBCT, POOL, RS, SASR, SITC, SNA, SON, T, TRN, TSCO, TZOO, UNP, VLO, WSO

·     Earnings After the Close: ABCB, ACBI, ARI, ASB, BJRI, BOOM, CAMP, CE, CSL, CSTR, FRME, GBCI, ICBK, INTC, KN, MAT, MSBI, OZK, PINE, RBNC, SAM, SBCF, SCKT, SIVB, SKX, SNAP, STX, USX, VICR, VRSN, WWE

 

 

Macro	Up/Down	Last
Nymex	-0.30	61.05
Brent	-0.36	64.96
Gold	-5.15	1,788.65
EUR/USD	0.0015	1.2050
JPY/USD	-0.06	108.02
10-Year Note	+0.00	1.564%

 

 

Sector News Breakdown

Consumer

·     Chipotle Mexican Grill (CMG) 1Q adj EPS $5.36 vs. est. $4.89 on revs $1.7B vs. est. $1.74B, qtrly digital sales +133.9% (50.1% of sales), qtrly rest level op margin was 22.3% +470bps; for FY21 expect about 200 new restaurants; not providing FY21 comparable restaurant sales guidance

·     Churchill Downs (CHDN) Q1 EPS 87c vs. est. 56c; Q1 revenue $324.3M vs. est. $287.45M; Adjusted EBITDA of $110.6 million, up 100% compared to $55.3 million YoY; Derby City Gaming delivered record net revenue of $32.9 million, up 52% YoY; our TwinSpires Horse Racing business delivered record first quarter net revenue of $93.1 million, up 39% YoY

·     D.R. Horton (DHI) announces $1.0B stock buyback

·     Las Vegas Sands (LVS) Q1 revs fell -15.6% to $1.2B vs. est. $1.6B; Q1 operating loss was $96 million, compared to operating income of $6 million in the prior year quarter; Q1 net loss from continuing operations was $280 million, compared to $92 million YoY; consolidated adjusted property EBITDA was $244 million, compared to $349 million in the prior year quarter

·     Robert Half (RHI) Q1 EPS 98c vs. est. 79c; Q1 revenue $1.4B vs. est. $1.35B; sees Q2 EPS $1.05 vs. est. 79c and sees revenue growth 31%

·     Sleep Number (SNBR) 1Q EPS $2.51 vs. est. $1.83 on revs $568Mm vs. est. $580.2Mm; guides FY EPS at least $6.50 vs. est. $6.10 using 25% effective tax rt for remainder of year, plans to generate approx $300Mm op cash flow in FY21 with $75Mm CAPEX

·     Spirit Airlines (SAVE) Q1 adjusted EPS loss ($2.48) vs. est. loss ($2.54); Q1 revenue $461.3M vs. est. $459.1M; load factor for the first quarter 2021 was 72.1% on a year-over-year capacity decrease of 26.9%; Ended the first quarter 2021 with $1.9 billion of unrestricted cash, cash equivalents, short-term investment securities and liquidity available under the Company’s revolving credit facility

·     Whirlpool (WHR) 1Q EPS $6.81 vs. est. $5.41 on net sales $5.36B vs. est. $4.85B; guides FY21 EPS $22.50-23.50 vs. est. $20.89; sees FY net sales +13% vs. est. +6.9%, increased share repurchase auth by $2B to $2.4B

·     Zymergen (ZY) 16.13M share IPO priced at $31.00

 

Energy

·     Kinder Morgan (KMI) Q1 EPS 62c vs. est. 24c; Q1 revenue $5.21B vs. est. $3.03B; increases dividend 3% and raises 2021 guidance; for 2021, now expects to generate adjusted Ebitda in a range of $7.6 bln to $7.7 bln; also now expects to end 2021 with a net debt-to-adjusted Ebitda ratio in a range of 3.9 to 4.0

·     Chevron (CVX) is not interested in buying Exxon Mobil’s (XOM) 32.7% stake in Iraq’s West Qurna-1 oilfield, but Basra Oil Co., which oversees crude production in the region, says it still aims to finalize the sale of Exxon’s stake by the end of June.

·     Valero (VLO) Q1 EPS loss ($1.73) vs. est. loss ($1.89); Q1 revenue $20.8B vs. est. $18.65B; said operating loss in the first quarter of 2021 includes estimated excess energy costs of $579M, or $1.15 per share, related to impacts from Winter Storm Uri

 

Financials

·     Discover Financial (DFS) Q1 EPS $5.04 vs. est. $2.82; Q1 revenue $2.795B vs. est. $2.77B; net interest income for quarter decreased $68 mln, or 3%, from prior year period; qtrly provision for credit losses of ($365) mln decreased $2.2 bln from prior year period; Q1 of 2021 included an $879 mln reserve release, compared to a reserve build of $1.1 bln in q1 of 2020

·     Equifax (EFX) 1Q adj EPS $1.97 vs. est. $1.55 on revs $1.21B vs. est. $1.12B; sees Q2 EPS $1.60-$1.70 vs. est. $1.51 and sees Q2 revs $1.14B-$1.16B vs. est. $1.07B

·     SLM Corp. (SLM) Q1 EPS $1.77 vs. est. $1.07; Q1 net interest income down 17% to $331M vs. $400M last year; Q1 Private education loan originations of $2.1B, down 10%; average private education loans outstanding, net, of $21.0 billion, down 11%, as a result of loan sales

·     SL Green Realty (SLG) Q1 EPS loss (11c) and FFO $1.73 vs. est. loss (16c); Q1 revenue $226.1M vs. est. $193.67M; entered into a contract to sell its 20.0% interest in 605 west 42nd street, for a gross valuation of $858.1 mln and entered into a contract to sell its interests in 400 east 57(th) street for a gross valuation of $133.5 mln

·     Texas Capital (TCBI) Q1 EPS $1.33 vs. est. $1.10; Q1 net interest income down -12% YoY to $200.1M; Total mortgage finance loans, including mortgage correspondent aggregation loans held for sale, decreased 2% on a linked quarter basis (decreasing 15% on an average basis) and increased 10% from the first quarter of 2020

·     Credit Suisse (CS) established over $20B of exposure to investments related to Archegos Capital, but the bank struggled to monitor its exposure before the fund was forced to liquidate many of its major positions – WSJ

 

Healthcare

·     Evolus (EOLS) 9M share Spot Secondary priced at $9.50

·     NeuroPace (NPCE) 6M share IPO priced at $17.00

 

Industrials & Materials

·     Dow Inc. (DOW) Q1 operating EPS $1.36 vs. est. $1.14; Q1 revenue $11.9B vs. est. $11.09B; packaging & specialty plastics segment net sales were $6.1 bln, up 32% versus year-ago period; qtrly performance materials & coatings segment net sales were $2.1 bln, up 3% over year-ago period; sees broadening economic recovery, aided by vaccine distribution progress & tight market fundamentals, to continue to benefit co’ businesses

·     Pentair (PNR) Q1 adj EPS 81c vs. est. 62c; Q1 revenue $865.9 vs. est. $778.2M; raises FY21 adj EPS $2.80-$2.95 from $2.60-$2.75 (est. $2.74) and raises FY21 sales guidance to up approximately 6%-11% from 3%-5%

·     Graco Inc. (GGG) Q1 EPS 58c vs. est. 50c; Q1 revenue $454.1M vs. est. $428.75M

·     Landstar (LSTR) 1Q EPS $2.01 vs. est. $1.63 on revs $1.288B vs. est. $1.15B; sees 2Q revs $1.4-1.45B vs. est. $1.18B, sees 2Q EPS $2.20-2.30 vs. est. $1.61

·     Rush Enterprises (RUSHA) Q1 EPS 79c vs. est. 51c; Q1 revenue $1.23B vs. est. $1.28B; economic recovery from covid-19 impact continues, but supply chain issues remain; doesn’t believe currently that parts supply constraints will have significant effect on aftermarket rev in 2021

·     Valmont Industries (VMI) 1Q EPS $2.57 vs. est. $2.12 on sales $774.9Mm vs. est. $756.3Mm; guides 2Q sales $805-830Mm vs. est. $800.3Mm; reaffirms FY outlook

 

Technology, Media & Telecom

·     AT&T (T) Q1 adj EPS 86c vs. est. 78c; Q1 revenue $43.94B vs. est. $42.69B; sees 2021 consolidated rev growth in 1% range on comparative basis; sees 2021 adjusted eps to be stable with 2020; sees 2021 gross capital investment in $22B with capex in $17B; Q1 postpaid net adds of 823,000; qtrly postpaid phone net adds of 595,000; qtrly prepaid phone net adds of 207,000; had 63.9M worldwide HBO max and HBO subscribers at qtr-end

·     CACI Int’l (CACI) Q3 EPS $4.78 vs. est. $3.70; Q3 revenue $1.55B vs. est. $1.57B; boosts FY21 EPS view to $18.00-$18.40 from $14.47-$15.25 (est. $15.32); lowers FY21 revenue view to $6.00B-$6.08B from $6.05B-$6.25B (est. $6.14B); Total backlog as of March 31, 2021 was $22.3 billion compared with $19.9 billion a year ago, an increase of 12.3%

·     Crown Castle (CCI) 1Q FFO/shr $1.71 vs. est. $1.61, qtrly site rental revs $1.369B; guides FY AFFO/shr $6.74-6.85 (from prior $6.64-$5.74) vs. est. $6.66; Raises FY21 revenue view to $5.67B-$5.72B from $5.53B-$5.58B (est. $6.19B)

·     Lam Research (LRCX) 3Q adj EPS $7.49 vs. est. $6.62 on revs $3.848B vs. est. $3.696B; guides 4Q revs $3.75-$4.25B vs. est. $3.689B, sees 4Q EPS $6.92-7.92 vs. est. $6.76

·     NetGear (NTGR) Q1 adj EPS 99c vs. est. 66c; Q1 revenue $317.9M vs. est. $310.21M; sees Q2 revenue $305M-$320M vs. est. $325.62M; says Q2 GAAP operating margin is expected to be in the range of 6.5% to 7.5%, and non-GAAP operating margin is expected to be in the range of 9.0% to 10.0%

·     Plexus Corp. (PLXS) 2Q EPS $1.42 vs. est. $1.25 on revs $881Mm vs. est. $881Mm; guides 3Q revs $875-915Mm vs. est. $886.5Mm, sees 3Q EPS $1.23-1.38 vs. est. $1.21

·     Qualtrics (XM) Q1 adj EPS 1c vs. est. loss (3c); Q1 revenue $238.6M vs. est. $227.37M; sees Q2 adj EPS (3c)-(1c) vs. est. loss (4c); sees Q2 revenue $240M-$242M vs. est. $229.32M; sees FY21 adj EPS loss (13c)-(11c) vs. est. loss (17c); sees FY21 revenue $980M-$984M vs. est. $953.57M

·     Sony Corp. films, including those featuring Spider-Man, will be available on the Disney+ (DIS) service, while other movies may appear on Hulu or the company’s cable networks, the studios said Wednesday. The deal begins next year and runs through 2026

·     KnowBe4 (KNBE) 9.5M share IPO priced at $16.00